United Nations Risks Bankruptcy as Resources Shrink, Needs Grow, Secretary-General Warns Fifth Committee during Discussion on Proposed 2026 Programme Budget
Warning of the risk of bankruptcy amid shrinking resources and growing needs, the United Nations chief today briefed the Fifth Committee (Administrative and Budgetary) on the Organization’s proposed budget for 2026, outlining the funding and staffing required to maintain peace and security, protect human rights, advance sustainable development and achieve other key objectives.
Secretary-General António Guterres explained both his initial programme budget proposal (document A/80/6) and subsequent revisions, including cuts of $577 million (15 per cent) and 2,681 posts (19 per cent).
“The revised estimates do not replace the proposed programme budget,” he said, adding: “Rather, they introduce targeted adjustments to specific areas. In practical terms, these affect about 15 per cent of the resource requirements — while 85 per cent of the proposed resources in the initial proposal remain indispensable.”
He also highlighted the UN’s cash-flow challenges, which occur when Member States do not pay their mandatory contributions on time or in full. The situation is further complicated by unspent funds, often resulting from payments arriving too late in the fiscal year or from unpaid contributions. Under the UN’s Financial Regulations, any unspent money at the end of a budget period must be returned to Member States as credits against future assessments, meaning the Organization cannot simply retain leftover funds to cover future shortfalls.
“We will again spend less than the budget in 2026 because we did not collect enough,” he said, warning that the Organization’s regular operations could collapse. The UN could also face the prospect of returning $600 million — potentially 20 per cent of the budget — in 2027. “That means a race to bankruptcy,” he added.
In that regard, he once again proposed that the General Assembly temporarily suspend the return of credits against the 2026 assessment. “Failure to reach an agreement on addressing the deteriorating liquidity situation could jeopardize critical elements of our programme of work,” he stressed.
$3.72 billion Budget Reflects Priorities Set by General Assembly
Providing more details on the initial proposal, he said that it reflects “the priorities set by the General Assembly and lay the foundation for bold, efficient proposals for next year — and beyond”. It amounts to $3.72 billion, slightly below the 2025 approved budget. It includes funding for 37 special political missions. The budget provides for 14,275 posts and supports the UN’s three pillars — peace and security, development and human rights — in a balanced manner.
Key allocations include maintaining a $53 million commitment for the resident coordinator system and a $50 million grant for the Peacebuilding Fund. An additional $2 million is proposed for the regular programme of technical cooperation to fund a harmonized fellowship programme across the five regional commissions, a 60 per cent increase since 2019. The budget also strengthens the Office of the United Nations High Commissioner for Human Rights’ (OHCHR) regional presence in Addis Ababa, Bangkok, Beirut, Dakar, Panama City, Pretoria and Vienna, consistent with Member States’ requests under the Pact for the Future.
Pragmatic Response to Evolving Fiscal Realities, Member States’ Expectations
He said that, following the initial programme budget proposal, the Secretariat conducted a comprehensive review of its resource requirements for 2026 — a process that resulted in the revised estimates, which are now under consideration by the Advisory Committee on Administrative and Budgetary Questions (ACABQ).
“The revised estimates report is a pragmatic response to evolving fiscal realities and Member States’ expectations,” he said.
The proposed budget is $3.238 billion, a reduction of $577 million (15.1 per cent) compared with 2025, with 11,594 posts, including special political missions, down 2,681 posts (18.8 per cent). Despite these substantial reductions, the budget maintains balance across the UN’s three pillars — peace and security, development, and human rights — while protecting programmes that directly support Member States, particularly least developed countries, landlocked developing countries, small island developing States and Africa’s development.
The reductions are targeted at larger Secretariat departments and focus on resource optimization, streamlining administrative services, consolidating functions, reducing overlap and exploring lower-cost delivery models. Initial proposals from the first workstream of the UN80 Initiative are included, such as creating common administrative platforms in New York and Bangkok, consolidating payroll processing into a single global team, and reviewing functions to identify those that could be performed effectively in lower-cost duty stations.
He also detailed the financial situation the Organization is currently facing. (See Press Release GA/AB/4504 for our recent coverage of this topic).
UN80 Initiative Must Enhance Cooperation, Avoid Duplication
Juliana Gaspar Ruas (Brazil), Chair of Advisory Committee on Administrative and Budgetary Questions (ACABQ) presented the body’s report on the proposed programme budget for 2026 (document A/80/7). She noted that initial UN80-related recommendations could not be incorporated into the submission and would appear in revised estimates later. Excluding these additional proposals, the 2026 budget of $3.715 billion represents a decrease of $99 million (2.6 per cent) compared with 2025. The 10,667 posts proposed for the regular budget, excluding special political missions, reflect a net increase of 134 posts (1.3 per cent) over 2025. ACABQ deferred consideration of most post-related proposals pending revised estimates under UN80, except for proposed abolishments, she noted.
She emphasized closing gaps in specific areas, particularly in geographical representation, urging the Secretary-General to intensify efforts to achieve more equitable staffing from unrepresented or underrepresented Member States. It called for careful review of high-level posts to minimize overlap and recommended raising workload standards for documentation staff by 20 per cent in light of technological improvements. ACABQ expects the UN80 Initiative to enhance cooperation, avoid duplication in the development pillar and enable OHCHR to review mandates, capacities, expenditures and workloads for greater efficiency and transparency. For global communications, it encouraged a holistic assessment of operating locations, staffing and resource allocation to modernize and optimize UN information centres.
Eight Priorities for 2026-2028
Jesús Velázquez Castillo, Vice-Chair of the Committee for Programme and Coordination, introduced the report (document A/80/16) of its sixty-fifth session, held from 12 May to 13 June. The Committee reviewed the draft plan for the 2026–2028 period and recommended that the General Assembly approve eight priorities. These include promotion of sustained economic growth and sustainable development in accordance with relevant General Assembly resolutions and recent United Nations conferences; maintenance of international peace and security; development of Africa; promotion of human rights; and effective coordination of humanitarian assistance activities. The remaining priorities are promotion of justice and international law; disarmament; and drug control, crime prevention and combating international terrorism in all its forms and manifestations.
The Committee also reviewed 28 programmes from the proposed programme budget for 2026 and made specific recommendations on 2 programmes — General Assembly and Economic and Social Council affairs and conference management, as well as jointly financed activities. It recommended that the Assembly plenary or relevant Main Committees examine the plans for 24 programmes and take no action on 2 programmes, namely, peaceful uses of outer space and economic and social affairs.
Maintaining Mandates, Promoting Equitable Geographical Distribution Must Prevail
In the ensuing discussion, delegates examined the potential impacts of the UN80 reform initiative, and proposed cuts to the funding and staffing.
The representative of Iraq, speaking on behalf of the Group of 77 and China, said that “efficiency gains must translate into improved delivery and responsiveness, not into the erosion of mandated programmes or staff reductions that affect developing country’s representation”. He expressed concern that the UN80 Initiative, which entails the abolishment of numerous posts, may further exacerbate existing imbalances in the Organization’s geographical distribution.
As such, “the UN80 reform is not merely a financial or structural undertaking; it is a profound opportunity to embody the values we champion”, said Japan’s representative, adding that it presents a chance to advance rejuvenation, promote gender equality, and achieve geographical diversity, including closing gap between the desirable range and actual staff numbers for under-represented countries. China’s delegate added that reforms must fully address the substantial needs of developing countries, safeguard the development pillar through institutional mechanisms and resource allocation, ensure equitable geographical representation, and increase staff representation from developing countries.
The representative of Guinea-Bissau, speaking for the African Group, warned that the Fifth Committee’s working methods must be adhered to and its work should not be rushed in the interest of expediency. He emphasized that resource allocation in priority areas such as the promotion of sustained economic growth and sustainable development — particularly in Africa — should be enhanced. Liberia’s delegate, recalling his country’s experience transitioning from conflict to peace, stressed the need for adequate resourcing for peacebuilding and special political missions.
The representative of the European Union, in its capacity as observer, noting that the bloc is the UN’s largest collective contributor, stressed that liquidity measures must not place additional burdens on those Member States who consistently meet their financial obligations. “We all bear a collective responsibility to ensure that the Organization is adequately funded at a time when the UN system, its staff and the peoples it serves are looking to us for leadership,” he said. On that, Switzerland’s representative, also speaking for Liechtenstein, said that each budget line reflects a shared responsibility and the mandates must guide the use of resources.
Deliberate Withholding of Contributions Sets Up UN for Failure
However, “over the years, we have witnessed artificial constraints that have set the United Nations up for failure, including the deliberate withholding of contributions by certain Member States,” said Singapore’s delegate, speaking on behalf of the Association of Southeast Asian Nations (ASEAN), adding: “Such actions undermine the United Nations at a time when Member States should work together to safeguard and strengthen multilateral system.” It is critical to ensure that regional economic commissions such as the Economic and Social Commission for Asia and the Pacific (ESCAP) and the resident coordinator system are adequately resourced to help developing countries meet their socioeconomic development goals.
“We all know why we’re in this situation,” Cuba’s delegate said, adding: “We cannot be held hostage by the will of the United States nor should we take decisions lightly.” Presenting a revised budget in September leaves the Fifth Committee with almost no time to carry out the necessary deliberations. The Secretariat must also consider possible contingency plans if the budget deliberations extend beyond 31 December, she cautioned. Adding to it, Brazil’s speaker noted the Organization’s chronic arrears — partly due to shortcomings in the credit-return mechanism — and urged all Member States to pay their assessed contributions in full, on time and without conditions.
Haiti’s delegate, who spoke on behalf of least developed countries, landlocked developing countries and small island developing States, highlighted the “profound structural challenges” that hinder the development of these countries. She stressed the importance of adequate, accessible and transparent financing, and the relevant international commitments must be implemented, with particular attention paid “to countries that are exposed to multiple vulnerabilities such as Haiti”.
Reducing Duplication within UN System Must Be Taken Seriously
The representative of the Russian Federation observed that not all Secretariat departments adhered to resolution 79/318, which stresses the need to avoid duplication within the UN system. Only the Department of Management Strategy, Policy and Compliance, the Department of Operational Support, the Department of Political and Peacebuilding Affairs, and the Department of Peace Operations submitted measures to reduce overlap. He cautioned against inclusion of the Department for General Assembly and Conference Management in UN80, as conference services — already chronically underfunded — are not mentioned in the resolution. He urged the Secretary-General to provide full information and support to Member States on this agenda item, especially about the posts affected, including post title and job family, division or unit, incumbency status, and staff nationality and gender.
The representative of Saudi Arabia welcomed the continued allocation of resources to vital areas reflecting the UN’s three work pillars. Highlighting the importance of financial support to the United Nations Relief and Works Agency for Palestine Refugees for Palestine Refugees in the Near East (UNWRA), he said there exists no viable alternative to the Agency. He also called for additional support for the International Court of Justice, whose staffing resources have not grown despite an increasing caseload. However, he expressed concern that one regional group continues to dominate the Court’s staff and called for stronger geographic representation.
Israel’s speaker said the Fifth Committee should avoid the politicization of its agenda and focus on administrative and budgetary issues. “Other political discussions could be discussed in other Committees,” she said.
UN’s Current Financing Model, Penalty System Untenable
In response to concerns raised by Member States, the Secretary-General said that staff separations must be implemented carefully to ensure that the proportion of staff from unrepresented and underrepresented countries increases, not decreases. He assured delegations that “no mandates will be negatively impacted by all the reforms we are proposing”, except those that Member States themselves decide to modify, emphasizing that the reforms are aimed at improving mandate-delivery.
Turning to the Organization’s liquidity crisis, he said the revised estimates do not address the problem, noting that the UN began 2025 with $700 million in arrears and that 10 per cent of the 2024 budget remained unspent due to a lack of funds. In 2025, the percentage of unspent funds could reach 20 per cent. He warned of a “vicious cycle” in which delayed or non-payments and reimbursement obligations could push the Organization towards insolvency, adding that his successor could face an “unbearable” financial situation.
To avert such a scenario, he urged Member States to pay their contributions in full and on time, support a temporary mechanism to defer reimbursement of unspent funds, and consider revising the UN’s current financing model and penalty system, which no longer reflect present realities. If nothing changes, he cautioned, the Organization risks reaching a point where it can no longer sustain its essential operations.
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